You should always be thinking about your retirement. As crazy as it might sound, you really should be thinking about retirement in your early twenties. Not because you’ll be planning to stop working in the next few years but rather due to the fact that you’ll be there sooner than you think. So, you have to be prepared. You need to make sure that you have enough cash in your account to survive comfortably without the income that you might have been relying on. To do this, you need to consider ways that you can build up your capital, avoid debts that will eat your savings and live smart financially.

Recently, there was an advert for pension saving schemes. It showed two people’s lives in retirement on the saving plan they were currently on. One the one side someone was saving a lot and having a wonderful time after retirement. On the other, they were saving the bare minimum, and the projection for their retirement certainly wasn’t as rosy as they’d probably hoped. So perhaps this is the best place to start when thinking about your retirement.

How much are you saving? Ideally, you want to save around a quarter of your paycheck for your retirement. Unfortunately, for most people, this probably isn’t realistic. Particularly, when you take into account rent, bills, little luxuries and other expenses. You might hear people say that if you can’t afford to save your pension, you’re living past your means. But at what point are you sacrificing your enjoyment now to pay for a great future?

As such, you should really just be saving as much as you can reasonably afford. A few hundred each month isn’t an absurd level, and it’s one that most people should be able to meet. So, if you’re saving around that amount of money, you’ll have a nice pension pot to fall back on when you retire. If you’re struggling to save any money at all, a handy tip is to start thinking of it like another bill or even tax. It has to come out of your account at the end of the month. Of course, saving is a great start, but there is more that you can do to protect the outlook of your retirement and maybe even quit working earlier than most.

Most people working now will be retired around 65-70 with the retirement age steadily increasing every year. You probably want to retire earlier than that and make sure you can still enjoy those last years in full. That’s why you want to buy property. There is an argument as to whether it’s financially wise to invest in property. And yes, it’s true to say that some people do end up in debt because they buy property and find that they can’t afford it. But that scenario is quite rare. The key thing to remember is that when you buy property, you leave yourself with capital that you can use and fall back on.

You might buy it with a loan but you can steadily pay that off, and if you’re doing this you can probably cut back a little on savings. Essentially, your home is your savings because you’ll be able to use the money you’ve put into it to move to a bigger home and pay the rest of the money on that one off. Then, when you retire, you can sell that and again, free the capital, moving to a smaller home and live comfortably through retirement. Yes, it sounds all too easy, doesn’t it? Well, it’s not, but it’s definitely possible if you commit to this type of plan. You just have to make sure you have some money in your accounts so that you don’t end up in debt when the home needs a repair or two.

If you want to be well off when you retire or retire early, you better make sure that you have more than one income. In fact, it’s advisable that you have at least two incomes and ideally three. The good news is that one of these incomes can be completely passive and the other one you can complete in your spare time.

The nonpassive income would be what is essentially a side hustle. It’s something you can do outside of your main job, perhaps at the weekend to earn a little extra cash. The great thing about this is that if you already have a solid plan in place for your finances, that side hustle cash can be spent on things you want. But wait, isn’t that just wasting your money? Actually, no because you probably will be buying these products or services anyway. This way, they won’t affect your overall financial savings.

An example of a side hustle would be tutoring students. You might have experience as a teacher or perhaps an academic. If so, then you’ll be able to offer the support that parents are always looking for to push up their kid’s grades.

Or, you might want to consider working from home, making money online. Fortunate Investor has some great examples of ways to make money on the net. One example would certainly be working as a freelancer writer. With this job, you can provide content to websites and easily earn a lot of money in no time at all.

What about the passive income? Well, that could be any type of investment that doesn’t require a lot of your time. If you’re looking for a great example of this, you should think about flipping properties. To flip a property, you need to invest in a fixer-upper. Spend a few months renovating it on the weekends, using services from pros rather than elbow grease. Once you have done this, you can then sell it on and pocket the profit. Some people easily make double to original value of the home doing this, though it does depend on whether you buy the right property.

If you’re going to retire early and retire well, you need to understand the value of money. This means that you should avoid spending money in areas that won’t benefit you in the long run or that will probably turn out to not have been worth it. An example of this would be buying a new car.

According to financial experts, it’s never a smart idea to buy a car brand new because you’re pouring money down the drain by doing this. At best you’ll be wasting a few thousand that you could have saved if you bought the car second hand. At worst, you could be wasting a small fortune because you were desperate to own a dream car that will lose half it’s valued in a few years. There are exceptions to this. You might buy a classic, and if that’s the case, it could even be considered a solid investment. But this possibility is quite rare.

Of course, this is just one silly spend that you want to avoid when you’re working towards a solid retirement. Another would be tech. Tech depreciates almost as rapidly as cars. So, if you want the latest tech, it’s worth just waiting a couple years until it drops in price. Yes, you’ll always be a couple years behind the trends. But you’ll also be saving a lot more money compared with the typical consumer.

As you can see then, it is possible to retire earlier than most and to make sure you have a solid cushion of cash to fall back on. Goodluck!